GROWTH forecasts for the economy are widely expected to be downgraded in this week’s Autumn Statement, as the UK faces the unwelcome prospect of a triple-dip recession.

The Statement, a forerunner to the Budget, will be delivered by Chancellor George Osborne on Wednesday.

Simon Ward, respected chief economist at leading fund manager Henderson Global Investors said: “It is very likely that the Office of Budget Responsibility [OBR] will downgrade its growth forecasts, given that in March it thought the economy would grow by 0.8 per cent this year and 2 per cent in 2013.

“The current consensus forecast is for minus 0.2 per cent for this year and 1.1 per cent for next year.”

Will Straw, associate director at the IPPR think tank, said: “The OBR will have to downgrade its forecast of 2 per cent growth for next year, I think it will be closer to 1 per cent.”

The news will be a setback for the UK economy, which has just exited a damaging double-dip recession. It grew by an impressive 1 per cent in the third quarter of 2012, but this figure was flattered by one-off factors, including Olympic ticket sales.

It is very likely that the Office of Budget Responsibility [OBR] will downgrade its growth forecasts, given that in March it thought the economy would grow by 0.8 per cent this year and 2 per cent in 2013

Economist Simon Ward

Fears are mounting that GDP will dip back into negative territory in the current fourth quarter, depending on how much money consumers spend in the run up to Christmas. The economy would also have to shrink in the first quarter of next year for a technical recession to reoccur.

Howard Archer, chief UK economist at think tank Global Insight said the economic outlook depended on whether consumers spend freely over Christmas. He said: “If there is a GDP drop in the fourth quarter it is only likely to be very small, say 0.1 per cent or 0.2 per cent quarter-on-quarter.”

This Friday, industrial output figures will give the first reading of how one of the biggest sectors of the UK economy performed at the start of the fourth quarter.

The latest meeting of the monetary policy committee is also this week.

Archer sees no change to monetary policy this month.

He said: “However, with economic recovery looking feeble, fragile and far from guaranteed, we continue to lean towards the view that the Bank of England will ultimately decide to give the economy a further helping hand with a final £50 billion of Quantitative Easing. We expect this to occur very possibly in February 2013.”

He expects interest rates to remain at 0.5 per cent for another two years.

The Autumn Statement is also expected to signal a new dash for gas, with tax breaks likely for shale gas exploration.

The Chancellor is also expected to confirm yet more rises in air passenger duty (APD) despite stiff opposition to the unpopular tax. A 2.5 per cent rise is expected, to take effect from April.

Over the summer 200,000 people wrote to their local MP calling for the Treasury to undertake a proper economic review of the tax. Mark Tanzer, chief executive of travel association ABTA said: “Another increase in APD is simply not the answer to reducing the deficit.

“We already pay the highest levels of air tax in the world and a further increase risks punishing people for flying and stalling business growth.”

More than half of the UK’s airports expect passenger numbers to be hit in 2013 if the Chancellor sticks to the planned rise.

The survey of UK airports, conducted by the Airport Operators Association, found that 1 in 4 say that as a direct consequence of the 2013-14 planned APD rises, passenger numbers would fall by more than 5 per cent. Every airport surveyed backed calls for a freeze in air taxes.